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Eleventh-Hour Deal on Federal Budget Avoids Government Shutdown

Mere hours before an impending shutdown of the federal government, congressional leaders and White House officials brokered a deal to end the months-long standoff over the federal budget for Fiscal Year 2011 on April 8, 2011. The final deal was reached over seven months after the federal Fiscal Year commenced on October 1, 2010. A well-publicized battle royale raged in Washington throughout February and March, with Democrats and Republicans, the Senate and House of Representatives, Congress and President Barack Obama, and even the various factions of the Republican caucus in the House of Representatives unable to find common ground. Negotiations centered primarily on the Far Right’s unrelenting demands for unprecedented, draconian cuts in domestic discretionary spending, the lion’s share of which would decimate social programs benefiting lower-income Americans. Talks also stalled over conservatives’ insistence that the final bill include various “policy riders,” attempts to blatantly exploit the appropriations process to enact ideologically driven laws that eliminate or place restrictions on funding for programs they find objectionable.

When the dust settled, Republicans had exacted $38.5 billion in budget cuts overall—“$78.5 billion below President Obama’s original budget proposal, which would’ve added $40 billion to 2010’s funding levels.”[1] The precise impact of the cuts on the country’s growing deficit has been questioned widely, however, with the non-partisan Congressional Budget Office estimating that the “historic” $38.5 billion in proposed spending cuts “would reduce federal spending by only $352 million this fiscal year, less than 1 percent of the bill’s advertised amount.”[2]

The tempest surrounding the budget negotiations began to swell in February when the Republican-controlled House of Representatives passed H.R. 1--a measure authorizing funding for the balance of the Fiscal Year that was $61 billion lower than Fiscal Year 2010 funding levels and $100 billion lower than President Obama’s budget request for Fiscal Year 2011. These sweeping reductions included the elimination of funding for the Teen Pregnancy Prevention Initiative and the Title X family planning program, in addition to cutting $1.6 billion from the National Institutes of Health (NIH), $1.4 billion from the Centers for Disease Control and Prevention (CDC), $1 billion from Community Health Centers (CHCs), $747 million from the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) program, and $50 million from Maternal and Child Health Block Grants.[3] In order to maintain funding for federal programs, Congress had passed a series of continuing resolutions since the beginning of the 2011 Fiscal Year. As negotiations intensified, the Republican leadership in the House of Representatives began attempting deeper spending cuts in these increasingly shorter stopgap measures; however, these cuts were rejected by Democrats and eventually by House Tea Party Republicans, who were growing agitated that the proposals did not contain the $100 billion in cuts that the Republicans had pledged in their 2010 campaign manifesto, A Pledge to America.

Tensions reached their zenith in early April when President Obama announced his intention to veto any further short-term continuing resolutions, forcing the various parties to hammer out a compromise for the remainder of the Fiscal Year. With the prospect of a government shutdown looming, public statements from congressional and White House officials embroiled in the round-the-clock talks indicated that Democrats and Republicans were at a stalemate. Democrats accused their opponents of refusing to accept a budget without objectionable policy riders—notably, the elimination of funding for Planned Parenthood contained in H.R. 1—while Republicans blamed Democrats for the impasse, claiming that they would not acquiesce to sufficient reductions in spending. Negotiations eventually resulted in a budget that would pass both houses of Congress and that President Obama would sign; however, few on either side of the aisle were satisfied completely.

Some public health programs escaped the full brunt of Republicans’ budget-cutting spree. The President’s Teen Pregnancy Prevention Initiative received $105 million—$5 million lower than in Fiscal Year 2010. In addition, the Title X family planning program not only survived intact but also saw its funding lowered to $300 million, a $17 million reduction from Fiscal Year 2010. Other public health agencies took significant cuts. Overall, funding for the Department of Health and Human Services (HHS) was cut by $3.4 billion, with the CDC facing a $730 million cut, the NIH a $260 million cut, and CHCs a $600 million cut. The full impact of the cuts to the HHS and CDC are unclear, as “the agencies will have wide discretion over the funding levels for many individual programs, unless the levels were specifically cited in bill language [and the] bill requires the departments to provide a spending or operating plan for fiscal year 2011 at a level of detail below the account level within 30 days of enactment.”[4]

The results of the battle over policy riders were mixed. Planned Parenthood retained its access to federal funding but a provision prohibiting the District of Columbia to use local funds to subsidize abortion care for low-income women was included in the final bill. For more information on the D.C. “abortion ban,” click here.